An overview of investment funds in Türkiye

Those who follow the Turkish economy in its recent era are aware of the amount of growth and prosperity that business markets have achieved in their various sectors, especially during the last two decades, which coincided with a period of openness, facilities, and other elements that benefited all sectors of the Turkish economy, which led to an increase in investor confidence. in the Turkish markets, and encouraged them to search for their opportunities within its fields, the most mature of which were participatory investment funds, which are the subject of our topic.

Investment funds constitute financial vessels with an encouraging working mechanism and investment components that are supposed to play their role in growth, through the carefully thought-out investment plans they provide.

The investment funds are run by a group of expert investors who have extensive experience and the ability to manage the participatory capital included in their funds. It is their responsibility to direct the fund’s capital towards various financial transactions according to the fund’s specialization, its prior work plans, and its government license, in addition to their role in managing capital and avoiding risks.

Then, investment funds distribute their profits to the participants in the fund according to their shares of its units divided based on capital, and according to periodic distribution plans. The owners of these units also have the opportunity to sell their shares to manage the fund at the appropriate time, which facilitates the smooth and convenient liquidation of capital.

Turkish investment funds are subject to strict regulation and laws by the Turkish Capital Markets Authority, and Turkish laws provide several tax advantages and deductions, which enhance investor confidence in these funds and reduce the risks of investing in them.

Types of investment funds in Türkiye

Investment fund management companies in Turkey offer a wide range of options that suit the needs of investors and their different investment goals. These options vary based on the investment tools and the fund’s orientations and programs.

Among the most famous mutual funds are:

• Stock funds: which direct their capital towards investing in shares of companies listed on the stock market (stock exchange).
• Bond funds: A category of funds invested in bonds, public debt instruments issued by the government or private sector companies.
• Real estate funds: those with real estate investments in various fields, such as residential buildings, hotels, commercial malls, or even lands, etc.
• Commodity funds: These are funds specialized in buying and selling high-value commodities, such as oil, gold, other precious metals, and capital market instruments based on precious metals, provided that they are traded on the stock exchange.

In addition to many specialized funds with different orientations, such as mixed funds, and comprehensive open-ended funds.

Advantages of investment funds in Türkiye

Participatory investment funds in Turkey provide many important advantages for the investor and his capital, which can be summarized in the following points:

• Regardless of the amount of your investment, your opportunity to invest in investment funds is preserved, by purchasing a unit, or some units in a fund.
• Mutual funds are managed by professional fund managers, who are responsible for conducting risk-return and forecast analyses, enabling you to grow your capital in a more informed manner.
• The investment fund usually distributes capital in several projects and deals taking into account potential risks, and thanks to carefully selected investment tools and advance plans to deal with potential risks, your capital is often safe from loss.
• Participation funds provide the opportunity to invest in international instruments and investments that are typically difficult for individual investors to access.
• Mutual funds in Turkey have important tax advantages. The specific withholding tax rate on mutual funds is 10% of net profit, while the tax rate is 0 percent for stock-intensive capital under specific conditions.
• Ease of buying and selling units owned by the investor, with the ability to liquidate capital when needed.

Disadvantages of investment funds in Türkiye

In general, investment funds may sometimes suffer from some defects that do not differ much from their counterparts in other types of investment, and perhaps they may be less risky than them, we mention these:

The risks that may affect the market in general or the Turkish currency and its exchange rate. Therefore, it is important to ensure the ability of the chosen fund’s management and the soundness of their plans to deal with these potential risks. You should also not be deceived by funds promising large profits over a short period, which are often characterized by operations fraught with the risk of losing capital and wasting it in usury or other activities.

Also, some types of private investments may be complex and difficult to understand for some investors, because they use complex investment strategies or because they invest in unfamiliar types of investments, which may worry the investor during his investment period.

In addition, the possibility of liquidating capital and selling units owned in the fund may not be as smooth as during a period of market turmoil, especially in some types of investments that are not easily tradable.

Are investment funds in Türkiye feasible?

It is not easy to judge all investment funds to be at the same level of success. Naturally, efforts, results, opportunities, and types of investment vary, as some achieve high profits or not.

But first, you must be aware that investment funds provide detailed bulletins about their activities and management team and other detailed information about the fund, and each investment fund must be studied separately before starting to invest in its units, and the task of making comparisons between funds is the duty of the capital owner and the investor who will choose the appropriate fund for him based on his investment field, the risks he can bear, the time horizon for investment until he achieves his goals, the current economic conditions, and the fees charged by the fund.

How do I start investing in investment funds in Türkiye?

Investment fund management companies in Türkiye provide a smooth approach to various investors wishing to acquire shares and units within one of these funds.

Once you open an investment account in one of these funds and purchase investment units; You will appear as if you are a partner within this mutual fund, and you will be able to monitor your investments and their growth following the desired goals and aspirations.

Are foreigners entitled to invest in investment funds in Türkiye?

The law regarding investment funds in Turkey does not specify any restrictions regarding foreign investments in Turkey, as any foreign investor has the right to invest in one of the licensed participatory funds, and it is known that all countries of the world encourage foreign capital to invest in their assets, because these investments contribute to the development of the local economy.

Every foreigner can open an investment account with a legally licensed investment fund, deposit money into his account, buy units in these funds, and sell them as part of the appropriate investment.

Establishing and managing investment funds in Türkiye by Oragon Company

Through our safe joint investment portal in Turkey, we provide our clients with opportunities to grow with their capital and achieve satisfactory investment returns with their units owned within our funds, which are managed by the most skilled investment and business experts in Turkey, who have proven their presence in the local market with businesses that have been trusted and companies that have achieved continuous prosperity in their businesses.

Oragon Company, a subsidiary of the Imtilak Investment Group in Turkey, manages many investment funds that it has excelled in dealing with competence and wisdom, and with extensive knowledge of the market risks and ambitious gains.

Edited by Oragon Company ©